Football Is Sinking in Crypto Snake Oil

Some of the world’s biggest football clubs are using their supporters’ loyalty to sell them blockchain assets, “fan tokens,” and NFTs. The crypto takeover of football promises to empower supporters — but in truth, it’s just marketing fluff for a web of pyramid schemes.

Football has been a laboratory for stupendously shady financialization. (Peter Glaser / Unsplash)

Football fans have had to put up with a lot lately. Match-going diehards have been squeezed for decades, with tickets in many of Europe’s top leagues becoming unaffordable. Attending away games isn’t just expensive but near impossible for many fans, with the spread of matches across weekdays and a constant rise in fixture congestion. Even for those stuck at home, things aren’t much easier. TV and digital streaming rights are often split between three or more providers, meaning fans have to shell out hundreds of dollars a season. Fans are sacrificing time, money, and attention just as all these things seem scarcer than ever.

So how do these beloved clubs repay their loyal supporters? By selling them snake oil by the fifty-five-gallon drum, of course. Football’s latest rip-off is a wave of initiatives revolving around pushing cryptocurrency and other blockchain-based products. We’re already seeing a boom in crypto club partnerships, “fan tokens,” and players and coaches flouting NFTs — and it looks like this is just the beginning. And while the digital-token-based Web3, touted as the future of the internet, may seem an odd fit for a 150-year-old sport, it should be no surprise that it’s latched onto football. For years, the sport has been a laboratory for stupendously shady financialization — and a dumping ground for oligarchic investors looking to launder money and reputations alike.

Football’s transformation from a sport dominated by fan-run clubs with democratic controls into a teetering tower of interwoven pyramid schemes in many ways reflects wider shifts in the economy. It’s bad enough that clubs are willing to use their bloated influence to push speculative grifts on those who trust and support them. But perhaps even more worrying is the way it’s undermining other rising demands for fan ownership. The intoxicating rhetoric of membership and influence pushed by Web3 firms distort such aspirations — while mirroring some of the most hollow and dangerous elements of their promises of decentralization and empowerment across the economy.

Token Benefits

If you’ve looked at football — with its nearly $50 billion in transfer fees paid in the last decade ($3.5 billion going to agents) or the ballooning, often arbitrary valuations of clubs billions in debt — and thought that the sport seems too financially stable, you’re in luck. Crypto and other blockchain technologies are helping football find exciting, unregulated new ways to get even more speculative and grind out further profit without actually providing anything new.

This hit a crescendo of farce with the botched attempt, late last year, by WAGMI United, an investment group of crypto bros and a twenty-two-year-old TikTok star, to buy English fourth-tier side Bradford City. WAGMI, attempting what would have been one of the first purchases of a major sports franchise with cryptocurrency as a significant funding source, hoped to make NFTs a crucial funding stream for the club.

That offer was rejected instantly — but crypto is here to stay. Cryptocurrency broker Voyager’s recent deal with the National Women’s Soccer League in the United States is one of the biggest sponsorships in league history. It includes a payout for players in cryptocurrency via a league-wide fund (evidently preferred to anything so outdated as fiat currency). Most crypto partnerships include similar provisions and are more elaborate than straightforward marketing deals.

Starting with Arsenal’s 2018 deal with CashBet Coin, cryptocurrencies, exchanges, and crypto-backed gambling ventures have used football as a beachhead into astoundingly costly sponsorships throughout the sporting world. Cryptocurrency exchanges and FTX spent over $1 billion in sports sponsorships in 2021 alone, inking deals with the UFC, NBA, Esports, MLB, and Formula 1, in addition to headline-grabbing football partnerships with Serie A and PSG. even recently signed a $700 million, twenty-year naming rights deal for a basketball and hockey arena in Los Angeles. Will exist in 20 years? Who knows? What is clear is that the company, recently hacked for $15 million and shrewd enough to pay roughly three times the industry standard for sponsorship rights, can definitely be trusted with your money.

Blockchain’s bombardment of football goes much deeper than cryptocurrency. A number of companies are using football’s popularity to push a host of Web3-related products down our throats and make it seem like an inevitability, as they’re doing elsewhere. Like much of the discourse around Web3, these partnerships are often couched in typical, poorly defined promises of empowerment and access for individual fans, or assertions that ignoring the latest form of what are essentially digitized, somehow more useless beanie babies, would be to turn your back on a bright future.

Socios is a company that issues club-themed cryptocurrency “fan tokens” that supporters can invest in — marketed as enabling football lovers to “Influence your team, access VIP rewards, exclusive promotions and join a global community of superfans.” It has already partnered with some of the world’s biggest clubs. Not only did Socios make a splash when PSG paid part of Leo Messi’s signing bonus in fan tokens, but football fans have been lured into paying more than $350 million for the highly volatile tokens. These tokens are frequently part of massive pump and dump schemes that leave supporters in the lurch when they’re too slow.

Meanwhile, Sorare, a fantasy football startup built around trading NFTs resembling player cards, is one of France’s best-funded startups, valued at $4.3 billion. The company lists football stars Antoine Griezmann and André Schürrle as investors and Gerard Piqué as a strategic advisor. Players often promote the cards and prices can be astounding. A Cristiano Ronaldo NFT, conveniently billed as “one of a kind” in an economy built entirely on artificial scarcity, sold for $289,000 in March. And though its ostensibly a game for football fans, some of the most effective players pool resources to increase winnings; one of the biggest earners is essentially a hedge fund run by a group of investors.

Crypto and NFT partnerships are everywhere in football. EminemReese Witherspoon, and Snoop Dogg aren’t the only celebrities hawking the notoriously hard-to-funge tokens. Current and former footballers like Reece James, Luke Shaw, and John Terry have pushed NFTs on their substantial social-media followings. Blockchain-based companies are increasingly recruiting recently retired or late-stage players, such as Barcelona legends Andrés Iniesta and Carles Puyol and Portuguese hardman Pepe, to serve as ambassadors.

Though most of these products are purely outlets for speculation, they prey on fan loyalty and make it increasingly difficult for supporters to avoid getting sucked into volatile digital snake pits. It’s not just about teams and players feeling no responsibility to those who idolize them; marketing around faux ownership is deeply cynical and dangerous. It could even be considered shocking — if it wasn’t happening everywhere else in the economy.

Fantasy Finance

In truth, predatory, poorly regulated get rich quick schemes are right at home in football, which has proven incredibly prone to financialization, even when this process is directly hostile to fans. Football clubs are themselves gaining popularity as speculative assets for the superrich. Many top European clubs are outlets for American investment groups, Russian oligarchs, and sportswashing ventures. Football clubs have proven excellent outlets for laundering money and bulk buying legitimacy.

With many owners essentially gambling on the clubs they own, it’s no surprise they’ve abandoned all subtlety in this regard. By far the biggest bloc of shirt sponsors in England’s Premier League are related to betting, with many having a cryptocurrency component. One extremely popular expression of this trend was the Football Index — a betting app that created a “football stock market” where users bought and sold shares in players. Alas, it lacked a sharp enough business plan even to make it as a Ponzi scheme and soon collapsed. Its case epitomizes the extent of financialized thought gripping football more generally, from ownership and sponsors to how the game and fandom are presented to supporters. The Football Index, like similar products, masked straightforward gambling with heady talk of investment and ownership.

Given its immense popularity, its weak regulatory structures, and its global nature, the sport often serves as a mirror for society as a whole. So it should be no wonder that football is evolving into a financialized hellscape where it’s hard to parse normal dealings from out-and-out pyramid schemes. That’s the world we live in, so why should football be any different?

But football, like the world, wasn’t always this way — and today’s crypto takeover is a far cry from football’s roots. The earliest football clubs in the nineteenth century were member-controlled, with predominantly working-class constituents. Democratic control via membership decisions in football was the norm in that era, just as the working class was asserting itself through labor organizing and the expansion of mass politics.

Full control by ordinary people tended to be diluted as professionalization rolled unevenly through the sport. Though membership structures often remained intact, many clubs became dominated by local businessmen. By the end of the twentieth century, football, like much of the rest of our lives, was commercialized, professionalized, and corporate, all about squeezing out another dime (though back then, not always directly at the expense of fans). Many of the most successful clubs in the world were beginning to resemble soulless, technocratically managed corporations more than football teams.

Now, as the world is hyper-financialized, football has inevitably followed suit. Crypto’s gold-plated promises of emancipation and empowerment for individuals, all delivered by decentralized platforms and currencies, are being touted to football fans, owners, and stakeholders. As we’ve seen, none of crypto’s jaw-dropping volatility, brazenly unregulated nature, extreme inequality, or unconscionable environmental impact have sufficed to give football institutions pause before partnering with shady actors in the crypto and NFT space.

Companies like Socios sell fan tokens by claiming, “We believe passion should be recognised and that every fan has the right to make their voice heard,” and asserting, “Fan Tokens are your digital pass to the teams you love. Unlike normal memberships, Fan Tokens never expire and are yours to keep forever!” This isn’t just deeply cynical but threatens to massively distort and derail legitimate calls by fans for a return to democratic control in football.

Years of growing frustration, capped by last year’s brazen attempt by some of the world’s biggest football teams to form a breakaway European Super League, has unleashed waves of renewed demands for fan ownership and greater oversight to curb greed in football. Not only are real rallying cries by football supporters the world over being hijacked; they’re being hastily repurposed to sell these exact supporters products that will greatly exacerbate the issues they’re frustrated about in the first place.

Fan tokens, crypto partnerships, and club- and player-linked NFT trading games often promise to give supporters some sorely missing influence over their favored teams. But this is almost always empty marketing fluff: the difference between a fan token, which is purely a means to gamble in an unregulated market, and a membership with voting rights in a club is pretty obvious. And when blockchain assets in the football world do provide any form of decision-making power for fans, they require the purchase of hyper-volatile speculative assets to access it, and usually only let fans pick between extremely similar away jersey options, not vote out the club president.

Keeping Blockchain Tech at Bay?

By now web3-related technology has sunk its claws deep into football, and it’s only likely to get worse. The explosive rise of many of these products does indicate their popularity. Still, it’s hard for fans (or consumers generally) to make informed decisions about products when they’re constantly rammed down their throats by their favorite institutions and celebrities.

Some of football’s most insidious actors, like FIFA’s Gianni Infantino or Real Madrid’s Florentino Perez, like to cite the interests of today’s youth when trying to sell reforms like the biennial World Cup or the European Super League. And we also hear that crypto, fan tokens, and NFT-fueled fantasy football are all the rage with “the kids.” But this doesn’t make them a good thing — and certain adults have a material interest in making young people hooked on these products.

If crypto offers us a glimpse into a dark, uninspiring future, the appeal of football is itself being used to help drag us there. There have been pockets of resistance to this takeover, with both regulators and supporters beginning to push back. But resistance needs to be much more widespread. Even if football fans and institutions become more hesitant about crypto, it’s hard to fight a generally unregulated enterprise in a silo.

Instead, football itself needs to be radically transformed. Calls for fan ownership, democratic decision-making, and sensible economics must be heeded. And not just for the long-term health of the game but so fans can afford to attend matches and help shape their club’s future. Unless it changes, football will be a ripe target for whatever currently unthinkably dumb financialized trend we’ll all be subjected to in the near future. Only action today can stave off tomorrow’s Groundhog Day of irresponsible ideas.